When it comes to Christmas shopping, it’s all about budget, budget, budget, unless of course you have a family with endless holiday wish lists. And while every parent does Christmas differently, a lot of people can’t help but wonder: how much money should you spend on your children during the holidays? How do you know if you are spending too much or too little? Luckily, there’s one new way that can help moms and dads calculate just how much is enough without having to break the bank.
According to a survey conducted by T. Rowe Price, about 60 percent of Americans admit that they spend way too much money on holiday gifts. Some even dip into their savings or 401k accounts in order to make the Christmas magic with an abundant amount of gifts for their family and friends.
But when it comes to your kids, you shouldn’t have to take money out of your retirement account in order to buy them the latest Nintendo Switch or the entire catalog from the American Girl store. Financial experts suggest that you create a budget to see how much you can spend and what you can afford before you even start your shopping spree or online purchases.
If you budget $500 for Christmas gifts, financial and investment professionals suggest that you only spend about 80 percent of that amount, which is about $400. That way you give yourself a little room to breathe with some leftover cash at the end of the month.
And as mentioned earlier: stick to your budget. If you intend on spending $50 on a gift but the price tag is $55, simply don’t buy it. It’s the extra dollars here and there that tend to add up. Also, forgo the stocking stuffers and the additional holiday goodies that - let’s face it - your child probably won’t even pay attention to. After all, it’s the big ticket items that usually count the most.
Should your children or someone in your family object to your Christmas budget, or simply pout over the spending limits, remind them of this: Christmas blessings are always free. With a special mark up on love, hugs and kisses, they might even get a great buy one, get one free special.